diff --git a/x/observer/keeper/msg_server_update_keygen_test.go b/x/observer/keeper/msg_server_update_keygen_test.go
new file mode 100644
index 0000000000..63aa026072
--- /dev/null
+++ b/x/observer/keeper/msg_server_update_keygen_test.go
@@ -0,0 +1,114 @@
+package keeper_test
+
+import (
+	"testing"
+
+	sdk "github.com/cosmos/cosmos-sdk/types"
+	"github.com/stretchr/testify/require"
+	keepertest "github.com/zeta-chain/zetacore/testutil/keeper"
+	"github.com/zeta-chain/zetacore/testutil/sample"
+	authoritytypes "github.com/zeta-chain/zetacore/x/authority/types"
+	"github.com/zeta-chain/zetacore/x/observer/keeper"
+	"github.com/zeta-chain/zetacore/x/observer/types"
+)
+
+// func createNNodeAccount(keeper *types.Keeper, ctx sdk.Context, n int) []types.NodeAccount {
+// 	items := make([]types.NodeAccount, n)
+// 	for i := range items {
+// 		items[i].Operator = fmt.Sprintf("%d", i)
+// 		keeper.SetNodeAccount(ctx, items[i])
+// 	}
+// 	return items
+// }
+
+func TestMsgServer_UpdateKeygen(t *testing.T) {
+	t.Run("should error if not authorized", func(t *testing.T) {
+		k, ctx, _, _ := keepertest.ObserverKeeperWithMocks(t, keepertest.ObserverMockOptions{
+			UseAuthorityMock: true,
+		})
+		authorityMock := keepertest.GetObserverAuthorityMock(t, k)
+		admin := sample.AccAddress()
+		keepertest.MockIsAuthorized(&authorityMock.Mock, admin, authoritytypes.PolicyType_groupEmergency, false)
+		wctx := sdk.WrapSDKContext(ctx)
+
+		srv := keeper.NewMsgServerImpl(*k)
+		res, err := srv.UpdateKeygen(wctx, &types.MsgUpdateKeygen{
+			Creator: admin,
+		})
+		require.Error(t, err)
+		require.Equal(t, &types.MsgUpdateKeygenResponse{}, res)
+	})
+
+	t.Run("should error if keygen not found", func(t *testing.T) {
+		k, ctx, _, _ := keepertest.ObserverKeeperWithMocks(t, keepertest.ObserverMockOptions{
+			UseAuthorityMock: true,
+		})
+		authorityMock := keepertest.GetObserverAuthorityMock(t, k)
+		admin := sample.AccAddress()
+		keepertest.MockIsAuthorized(&authorityMock.Mock, admin, authoritytypes.PolicyType_groupEmergency, true)
+		wctx := sdk.WrapSDKContext(ctx)
+
+		srv := keeper.NewMsgServerImpl(*k)
+		res, err := srv.UpdateKeygen(wctx, &types.MsgUpdateKeygen{
+			Creator: admin,
+		})
+		require.Error(t, err)
+		require.Nil(t, res)
+	})
+
+	t.Run("should error if msg block too low", func(t *testing.T) {
+		k, ctx, _, _ := keepertest.ObserverKeeperWithMocks(t, keepertest.ObserverMockOptions{
+			UseAuthorityMock: true,
+		})
+		authorityMock := keepertest.GetObserverAuthorityMock(t, k)
+		admin := sample.AccAddress()
+		keepertest.MockIsAuthorized(&authorityMock.Mock, admin, authoritytypes.PolicyType_groupEmergency, true)
+		wctx := sdk.WrapSDKContext(ctx)
+		item := types.Keygen{
+			BlockNumber: 10,
+		}
+		k.SetKeygen(ctx, item)
+		srv := keeper.NewMsgServerImpl(*k)
+		res, err := srv.UpdateKeygen(wctx, &types.MsgUpdateKeygen{
+			Creator: admin,
+			Block:   2,
+		})
+		require.Error(t, err)
+		require.Nil(t, res)
+	})
+
+	t.Run("should update", func(t *testing.T) {
+		k, ctx, _, _ := keepertest.ObserverKeeperWithMocks(t, keepertest.ObserverMockOptions{
+			UseAuthorityMock: true,
+		})
+		authorityMock := keepertest.GetObserverAuthorityMock(t, k)
+		admin := sample.AccAddress()
+		keepertest.MockIsAuthorized(&authorityMock.Mock, admin, authoritytypes.PolicyType_groupEmergency, true)
+		wctx := sdk.WrapSDKContext(ctx)
+		item := types.Keygen{
+			BlockNumber: 10,
+		}
+		k.SetKeygen(ctx, item)
+		srv := keeper.NewMsgServerImpl(*k)
+
+		granteePubKey := sample.PubKeySet()
+		k.SetNodeAccount(ctx, types.NodeAccount{
+			Operator:      "operator",
+			GranteePubkey: granteePubKey,
+		})
+
+		res, err := srv.UpdateKeygen(wctx, &types.MsgUpdateKeygen{
+			Creator: admin,
+			Block:   ctx.BlockHeight() + 30,
+		})
+		require.NoError(t, err)
+		require.Equal(t, &types.MsgUpdateKeygenResponse{}, res)
+
+		keygen, found := k.GetKeygen(ctx)
+		require.True(t, found)
+		require.Equal(t, 1, len(keygen.GranteePubkeys))
+		require.Equal(t, granteePubKey.Secp256k1.String(), keygen.GranteePubkeys[0])
+		require.Equal(t, ctx.BlockHeight()+30, keygen.BlockNumber)
+		require.Equal(t, types.KeygenStatus_PendingKeygen, keygen.Status)
+	})
+}